Consultation on Mersey Tidal Power approach to sustainability appraisal

Technology options put forward to generate tidal power from the Mersey Estuary

Power from the Mersey feasibility study

Mersey Tidal Power Feasibility Study

22 June 2011

A tidal power scheme in the Mersey Estuary could deliver enough electricity to meet the average needs of over 200,000 homes but the high construction costs mean that it is unlikely to go ahead without a change in the way we value renewable energy and security of supply.

Following many months of studies and investigations, a preferred scheme has been identified by the expert team commissioned by Peel Energy and The Northwest Development Agency (NWDA): a barrage across the river between New Ferry (Wirral) and Dingle (Liverpool). It would be designed so that the turbines within the barrage would generate power in two ways – from ebb tides only as well as from ebb and flood tides – and from a range of water level differences (operating heads) across the barrage. This choice of scheme allows for flexible, managed operations that would minimise effects on the Mersey’s protected intertidal habitats.

Multiple navigation locks would need to be included to accommodate large commercial ships and small leisure craft. Other facilities that could be included in the scheme include a visitor centre, a pedestrian / cycle path, a light public transport link and a tidal turbine research centre.

The studies have found that the estimated £3.5billion upfront construction costs result in a cost of electricity that is not competitive in the current energy and capital markets. Anthony Hatton, Peel Energy’s Development Director, said:

“In the longer term, once the upfront capital costs have been paid off and for the rest of its 120 year life, the cost of electricity would be very competitive. But the preferred scheme is unlikely to attract the necessary investment while the emphasis in the financial sector and renewable energy incentives is on technologies that provide short to medium term returns. We need to identify an appropriate funding structure that recognises the long term low cost of electricity, security of supply and wider economic benefits that investments such as this provide for future generations.”

Peel Energy will not be progressing the development work until it has confidence in the financial and regulatory framework for tidal power.

Mr Hatton continued, “We are grateful for all the valuable contributions made by many organisations and individuals to the Feasibility Study. We welcome feedback on the reports and look forward to progressing the project in the future.”

Mark Atherton, Head of Energy & Environment, NWDA said:

"The feasibility work has provided a valuable insight into how tidal energy schemes could be operated in the future to deliver wider economic impact, whilst minimising the potential environmental impact. Some of the lessons learnt from the work undertaken are applicable not just to the Mersey Estuary, but to other estuaries in the Northwest and UK."

Briefing Notes for Editors:
Peel Energy started looking into the possibility of generating power from the Mersey Estuary in 2005. In 2006-7 a pre-feasibility study was undertaken in partnership with NWDA and supported by the Mersey Basin Campaign. This concluded that a number of tidal power options had the potential to make a significant contribution to the UK’s renewable energy targets. In September 2009, a full Feasibility Study was launched by Peel Energy in partnership with NWDA. This Study has now been completed and is published on the project website www.merseytidalpower.co.uk .

All known tidal power technologies have been assessed using criteria to determine their suitability for the Mersey and their potential to contribute a significant amount of low carbon electricity in support of the UK’s renewable energy and carbon reduction commitments. Four technologies were identified for assessment. Two were selected for further study – an impounding barrage and a very low head barrage. The studies addressed technical, consenting (including environmental and socio-economic topics) and financial questions, as well as energy potential.

The likely environmental effects of different schemes and operating regimes have been carefully considered. The preferred scheme has been selected to minimise impacts while remaining as viable as possible. Residual environmental effects would be addressed through a package of mitigation and compensation measures.

All locations within the Estuary have been reviewed. The mouth of the estuary presents the highest energy potential – but shipping and landside constraints make this location unattractive. A barrage upstream of Garston and Eastham would avoid direct impact on shipping – but the lesser energy potential, higher cost to span the estuary and extensive intertidal sand and mud banks make this location unrealistic. The chosen location avoids impacts on vessels manoeuvring at Tranmere, benefits from a narrow span and exploits about 80% of the Estuary’s energy resource.

The scheme could generate around 1 terrawatt hour (TWh) per annum (1,000,000,000 kilowatt hours or units) and would make a valuable contribution to the area’s security of energy supply, carbon reduction goals and low carbon economy. The tides and consequently the electricity supply are predictable. The proposed technology is available and reliable and could supply low carbon electricity for 120 years.

During public consultation on the barrage scheme options between December 2010 and January 2011, of the 143 people who responded to the question “Do you broadly support the proposals for the Mersey Tidal Power project?” 73.5% expressed their support (see chart below).

The cost of energy from the best financial performing scheme is higher during its 35-50 year financing period than other large scale renewable alternatives such as onshore and offshore wind. Once the capital has been paid off, the cost of energy drops significantly to competitive levels that would allow for a good return to investors/Government. The level of Government support required during the financing period would need to be significantly higher than the 2 ROCs currently allocated to tidal power through the Renewable Obligation mechanism. There has as yet been no indication of a higher level of support through the Government’s proposed Electricity Market Reform; a White Paper is due to be published this summer. Competing schemes such as onshore and offshore wind have an operational life of 25 years and can typically be financed over a shorter period. Infrastructure projects such as road and rail improvements provide examples of longer term government backed investments, however there is currently no basis for this form of investment in the UK electricity generation sector.

Government policy on Tidal power has yet to be articulated in National Policy Statements. As such the policy argument and consenting route for the scheme has yet to be fully determined.

Further details of the options and the selection process are included in the Feasibility Study Reports that have been published on the project website: www.merseytidalpower.co.uk .

ROCS:
The Renewables Obligation is the main support scheme for renewable electricity projects in the UK. It places an obligation on UK suppliers of electricity to source an increasing proportion of their electricity from renewable sources. A Renewables Obligation Certificate (ROC) is a certificate issued to an accredited generator for eligible renewable electricity generated within the United Kingdom and supplied to customers within the United Kingdom by a licensed electricity supplier. Onshore wind farms receive one ROC for each megawatt hour (MWh) generated. Offshore wind farms receive 1.5 or 2 ROCs. Wave and tidal power schemes are eligible for 2 ROCs. ROCs are due to be replaced by a Feed-In Tariff under the Government’s proposed Electricity Market Reform.